Shares and shareholders

Approach

Bekaert is committed to providing high-quality financial information to its shareholders. Clarity and transparency are not empty words and it is Bekaert’s intention to engage constantly in an open dialogue with its shareholders.

Bekaert has always chosen to respond promptly to new international standards. The consolidated financial statements are prepared in accordance with the International Financial Reporting Standards (IFRS), which have been adopted by the European Union.

By creating value for the customer, Bekaert also creates value for shareholders and other stakeholders. Both private and institutional investors benefit from our sustained commitment to transparent reporting, be it at shareholders’ or analysts’ meetings. As a consequence, our shareholders have become more and more international.

Share identification

The Bekaert share is listed on NYSE Euronext Brussels as ISIN BE0974258874 (BEKB) and was first listed in December 1972. The VVPR strip is listed as ISIN BE0005640140 (BEKS). The ICB sector code is 2727 Diversified Industrials.

The Bekaert share in 2010

The year 2010 began with a sharp increase in the share price from € 108.50 (before share split) at year-end to € 118.20 in the first week of January followed by a slip back to a low of € 98.60 on
5 February. European Markets came under pressure as investors sold out of risk on heightened concern over the state of the budget deficits in Greece, Portugal and Spain. Worse than expected U.S. jobless claims data and the news flow on credit restrictions in China added to the worries over the economic recovery. The announcement of the acquisition of two Bridgestone tire cord plants and a multi-year supply agreement could not support the share at this moment due to the overall negative market sentiment.

At the day of publication of the 2009 results in February, the share price increased by about 10% to € 118.90 and continued to increase the following week to around € 125 due to positive changes in recommendations and target prices. The initiation of coverage by new brokers boosted further the share price to a new high of € 141.50. This level of share price tempered liquidity temporarily; existing shareholders were not willing to sell while potential shareholders were waiting for a dip in share price.

Macro developments continued to drive volatility, with a pickup in risk aversion stemming from the skepticism surrounding the ability of the Greek funding package to dampen sovereign credit contagion concerns. The European markets were searching for direction as strength in corporate numbers was offset by ongoing negative sentiment around those sovereign debt issues. Asian markets came under pressure in response to concerns about global growth slowdown rather than a credit or liquidity crunch. As a consequence the share price dropped sharply to around € 118 early May.

After the Euro area governments and the European central bank laid out a set of measures in order to safeguard the financial stability, the share price recovered by a strong increase of around 13% in one day. The same week, Bekaert announced its 2010 first quarter sales, which were very strong, based on a broad recovery in mature markets, a continuation of the Chinese success story and an indication of a similarly strong second quarter. The share reacted immediately with another increase by 8%, totaling an increase by more than 20% in one week. The share reached a new high of € 148.05 on 21 June. Following the strong gains, the share was pausing for breath at around € 140, waiting for half year results.

Capital structure

An Extraordinary General Meeting held on 7 October 2010 decided to split each of the Company’s shares, VVPR strips, subscription rights and share options into three new securities, and to abolish the Company’s existing bearer securities. The split became effective as of 10 November 2010. All numbers of Bekaert shares, VVPR strips, subscription rights and share options, as well as all prices of the Bekaert shares and VVPR strips and exercise prices of subscription rights and share options mentioned in this annual report are post-split numbers and prices, unless otherwise stated.

As of 31 December 2010 the registered capital of NV Bekaert SA amounts to € 176 242 000, and is represented by 59 884 973 shares without par value. The shares are in registered or non-material form.

The number of VVPR strips is 12 556 976.

The total number of outstanding subscription rights under the SOP1 and SOP2005-2009 stock option plans is 784 336.

A total of 381 566 subscription rights were exercised in 2010 under the SOP1 and SOP2005-2009 employee stock option plans, resulting in the issue of 381 566 new Company shares and VVPR strips, and an increase of the registered capital by € 1 124 000 and of the share premium by € 8 177 296.38.

In addition to the 89 700 treasury shares held as of 31 December 2009, Bekaert purchased 965 700 own shares in 2010. Those aggregate 1 055 400 shares were used as follows in 2010:

• 91 700 shares were delivered to the individuals who had exercised their options under the SOP2 stock option plan in 2010; and
• the remaining 963 700 shares are held as treasury shares.

As a result of the above-mentioned movements, the number of issued shares and the number of VVPR strips each increased by 381 566.

In 2010 a fifth and final issue of subscription rights took place under the SOP2005-2009 stock option plan: 225 450 subscription rights were issued to members of the Bekaert Group Executive, senior management and senior executive personnel. Each subscription right is convertible into one newly issued NV Bekaert SA share with VVPR strip at an exercise price of
€ 33.990. An aggregate 1 137 108 subscription rights have been granted under the SOP2005-2009 stock option plan.

In 2010 a final grant of 49 500 options took place under the SOP2 stock option plan: each option will be convertible into one existing NV Bekaert SA share with VVPR strip at an exercise price of
€ 33.990. A total of 463 260 options have been granted under the SOP2 stock option plan.

A new NV Bekaert SA Share Option Plan 2010-2014 (“SOP2010-2014”) was proposed by the Board of Directors and approved by a Special General Meeting in 2010. The plan will be the successor to the SOP2005-2009 and SOP2 plans, and will offer options to acquire existing Company shares to the members of the Bekaert Group Executive, senior management and a limited number of management employees of the Company and a number of its subsidiary companies. There will be one offer of share options in each of the years 2010 through 2014, and the aggregate number of share options to be offered will be determined each year by the Board of Directors on the motion of the Nomination and Remuneration Committee. The number of share options to be offered to each individual beneficiary will be variable in part, based on an assessment of such person’s long term contribution to the success of the Company. The share options will be offered to the beneficiaries for free. Each accepted share option will entitle the holder to acquire one existing share of the Company against payment of the exercise price, which will be conclusively determined at the time of the offer and which will be equal to the lower of: (i) the average closing price of the Company shares during the thirty days preceding the date of the offer, and (ii) the last closing price preceding the date of the offer. The share options cannot be exercised during a period of three years after the date of their grant nor after a period of ten years from the date of their offer. A first offer of 398 400 options was made on 16 December 2010.

The SOP2005-2009, SOP2 and SOP2010-2014 plans comply with the relevant provisions of the Act of 26 March 1999 and with Articles 520ter and 525, last paragraph, of the Companies Code.

Detailed information about capital, shares and stock option plans is given in the Financial Review (Note 6.11 to the consolidated financial statements).